Perth surges ahead as one of the world's most expensive cities

Lee-Maree Gallo

The booming economy and surging Australian dollar are seeing expats starting to feel the squeeze, with a new survey confirming Perth's ranking among the most expensive cities in the world.

A survey released today showed the city had jumped into the top 30 most expensive in the world in which to live for expatriate workers.

The Mercer Worldwide Cost of Living Survey 2011 ranked the WA capital at 30, up 33 places from the previous year. The survey, which covers 214 cities across five continents, measures the comparative cost of more than 200 items in each location including housing, transport, food, clothing, household goods and entertainment.

It has been designed to help multinational companies and governments determine compensation allowances for their expatriate employees.

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According to the survey Perth's surge in rankings was due to "the strengthening of the currency" and a "dramatic increase in rental prices".

The city is the third most expensive in Australia, with Sydney ranked 14 and Melbourne at 21. Brisbane sits below Perth at 31, Canberra ranks at 34 and Adelaide - which recorded the biggest climb - followed at 46. Last year Adelaide was ranked 90.

The survey found Luanda in Angola was the world's most expensive city, while Karachi in Pakistan was the cheapest. The top 10 ranked cities were dominated by Africa, Europe and Asia and included Tokyo, N'djamena, Moscow, Geneva, Osaka, Zurich, Singapore, Hong Kong and Sao Paulo.

The results follow last week's Economist Intelligence Unit's bi-annual Worldwide Cost of Living survey which ranked Perth as the 13th most expensive city in the world.

Curtin University economist Professor Peter Kenyon said the mining boom and resulting two-speed economy, increasing utility prices and rising Australian dollar were responsible for the hike in Perth's cost of living.

"Once upon a time someone from the UK coming to Australia would find it not too bad, whereas now they'd find it quite tough because relative to the Australian dollar, the pound has devalued quite a lot," he said.

Home rentals have also increased, with the average annual increase in rents for both houses and units higher than any other capital city other than Darwin, according to RP Data.

Lee Relocation Services owner Carol Lee, who works with new migrants to help them get settled in Western Australia, said her clients constantly remarked on how expensive Perth was.

However Ms Lee, whose clients were mostly engineers hailing from the USA, UK and Canada, said you got what you paid for in Perth.

"We also have a very good standard of living and once they get over the shock of it (cost of living) they get used to it," she said.

Ms Lee said most complained about the cost of rent and food but noticed utilities such as gas and electricity ended up being cheaper in the long run due to Perth having a warmer climate.

She also said the majority of expatriates did not want to return home once their employment contracts had ended.

"These guys are glad to be here," she said. "The Americans say we (West Australians) don't live to work we work to live and they see that as a huge plus of living in WA."

2 comments so far

Not just expatriates... I'm relocating from Sydney into a non-mining industry and am shocked by Perth's high alcohol prices and lack of cheap alternative food sources, like the huge cheap produce markets we have in Sydney & Melbourne.

But as with the expats, Perth's friendly people, lack of racial tension, low crime rates, clean streets, traffic-free non-toll roads and easy going feel still makes Perth a bargain for what you get :)

Commenter

World Traveller

Location

Western Sydney

Date and time

July 12, 2011, 9:05PM

Perth has some good aspects, as mentioned in World Travellers post. However, the cost of living is beginning to outstrip the quality. The last 3 years have seen costs rise astronomically, not in line with inflation and certainly not in line with service provided. Perth has few decent amenities other than natural attractions. Yes, we all love the parks and beaches but what is there to actually DO beyond that?That the Perth cost of living is significantly higher than the likes of London, Sydney, New York, Paris etc. is a bit of a crime considering what is on offer in those places. The mining boom is all well and good for the 2% who benefit from it but what about the rest of us who simply pay more as a knock on effect?